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Tuesday, 17 December 2013

GDP rebasing forecast to rank Nigeria's GDP above South Africa

By Olumide T. Agunbiade
Speaking at the just concluded CBO Annual Investors Conference, Dr. Kingsley Moghalu, deputy governor of the Central Bank of Nigeria (CBN), financial system stability has stated that the rebasing of Nigeria’s Gross Domestic Product is a welcome idea and is necessary and at the same time beneficial to the economy.

Expectations from rebasing the GDP is high with sources citing that it can increase the size of Nigeria’s economy by 40 per cent this increase will see Nigeria’s earnings increase from 250 billion US dollars to about 350 billion US dollars. The aim of the rebasing is to change the country’s base year computation GDP from 1990 to 2008.
The CBN’s deputy governor said that; “When we rebase our GDP, it becomes so huge, but it doesn’t mean that the infrastructure that I see in South Africa whenever I go there exists in Nigeria. It is creating this infrastructure here and not just having an absolute GDP figures that brings development.
“I agree that rebasing is essential because countries rebase their GDP every five years and at most, 10 years. But we haven’t done that in 20 years. Therefore our economic statistics are totally out of place as far GDP growth and output is concerned.
“What is happening is a healthy competition within African countries. The best way for Africa to grow is for countries to look at what their neighbors are doing. So in that context, it is not inappropriate for Nigeria to aspire to become a bigger economy than South Africa.”

The National Bureau of Statistics (NBS) had indicated the rebasing would be done next year. The rebased GDP figures were originally meant to be released in January 2012, but were moved to August 2012 following the petrol subsidy strike at the beginning of last year. Latter, it was extended to October and the new date is first quarter of 2014.

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